Chapter 7 Bankruptcy

chapter 7 bankruptcy

Chapter 7 Bankruptcy

What is a Chapter 7 bankruptcy?   A Chapter 7 bankruptcy is a way to get a fresh start by wiping out unwanted debt.  Filing bankruptcy is a process of filing a "voluntary petition" with the bankruptcy court to have your debts "discharged" or wiped out.  A discharge is an injunction (prohibition) to prevent your creditors from being able to collect on such debt.  

Will a Chapter 7 bankruptcy stop harassment from my creditors?  Yes, when you file bankruptcy the court grants an "automatic stay" stopping your creditors from pursuing collection action from you.  Thus, by filing bankruptcy it will stop harassing phone calls, garnishments, levies, and judgments.  

What debts can be discharged if I file bankruptcy?  There are many debts that can be discharged when you file bankruptcy to receive debt relief.  The most common types of debts that are discharged are credit card debt, medical, and other unsecured debts.   Debts are placed into different categories when you file bankruptcy such as "secured" or "unsecured" and "priority" and "non-priority" debts.   Debts are discharged depending on the type and category of the debt.   

Will I lose all of my property if I file bankruptcy?  No.  The bankruptcy code allows people filing bankruptcy the ability to "exempt" or protect a certain value of their personal property.  In California there are what they refer to as 703 and 704 exemptions.   Prior to filing your bankruptcy petition it is important to create a list of all your property, determine the value, and then to carefully exempt your property to the extent possible.   Working with an experienced bankruptcy attorney is critical to protecting your property from your creditors.  

Will I lose my house if I file bankruptcy?  Many people that file bankruptcy are able to keep their homes.  However, it depends on whether your home has equity and how much.  Also, it depends on other facts such as whether you are current with your mortgage payments.   Thus, if you are current on your mortgage payments and you have little or no equity in your home you shouldn't have a problem keeping your home if you file bankruptcy.  

Will I ever be able to get credit again if I file bankruptcy?  In most cases Yes.   Although when you file bankruptcy it will be reported on your credit report and will impact your credit score you will be able to rebuild your credit score with a little effort and time.  Then, after such efforts you should be in a position to buy a car or a home.  

Can anyone file a Chapter 7 bankruptcy?  No, those that file bankruptcy must meet certain requirements and pass the U.S. Trustee's means test guidelines.  Thus, if you are considering bankruptcy you should talk to an experienced bankruptcy attorney regarding your specific income and expenses to see if are eligible to file bankruptcy.  

Attorney Michael Johnson has worked with hundreds of people in preparing and filing bankruptcy. The most common form of consumer bankruptcy is chapter 7. A chapter 7 bankruptcy can help people put an end to debt that has overwhelmed their lives and that they can't repay. The objective is discharging unwanted debt. Individuals must qualify for bankruptcy. The process generally takes about 90 – 120 days from the time of filing the bankruptcy petition to obtaining a bankruptcy discharge.  

 Attorney Michael Johnson has worked with hundreds of people in preparing and filing bankruptcy. The most common form of consumer bankruptcy is chapter 7. A chapter 7 bankruptcy can help people put an end to debt that has overwhelmed their lives and that they can't repay. Bankruptcy is a legal process of preparing a bankruptcy petition that is filed with the court with the objective of discharging unwanted debt. Individuals must qualify for bankrutpcy and are able to keep certain property. The process generally takes about 90 – 120 days from the time of filing the bankruptcy petition to obtaining a bankruptcy discharge.  

 

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